NEC ECC: Application of Z Clause - Mandatory Use of Frameworks by Subcontractor

NEC3 and NEC4 Contracts Z clauses
1

I’m querying the application of the following extract from a Z Clause, relating to mandatory use of our supply chain Frameworks. The supply chain Frameworks are approved lists of suppliers of materials and services which our CDPs (Construction Delivery Partners) are required to use.

I read the following Z Clause to mean that if a CDP Subcontracts some portion of the Works - which involves the obtaining of Plant and Materials, Services or Equipment - then the Subcontractor would still have to use the Frameworks. My justification for this is Clause 26.1, applying back-to-back conditions to Subcontracts. The CDP interprets the Clause to mean that it is the Subcontract which is being obtained, and not the Plant and Materials, Services or Equipment. As such the Subcontractor is not required to use the Frameworks, as it does not say that the CDP must use a Framework for Subcontracts. The extract from the Z Clause is given below - any thoughts?

"The CDP shall to the extent provided for under the framework contracts obtain:
• items of plant and materials;
• services; or
• equipment;

for the works from the appropriate supplier listed under the Employer’s framework contracts"

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2

It’s difficult to provide a complete answer without sight of the rest of the framework documents, however four observations I can make are:

(1) Clause 26.1 of the ECC does not impose any obligations on the Contractor to enter in to back to back conditions with Subcontractors.

(2) The first line of the Z clause states “to the extent provided for under the framework” which appears to be a limitation clause that means that it isn’t applicable to everything, just those things stated in the framework.

(3) The Z clause makes no reference to the defined term Subcontractor, it specifically uses the term supplier which is not defined in the contract. So I’d be tempted to side with the Contractor here as the Z clause should have made specific reference to Subcontractors if this is who it was intended to apply to.

(4) You will need to examine the CDP’s subcontract terms and conditions to understand if the Contractor has included a similar Z clause in his subcontracts and the extent of the obligations this imposes.